Background Briefing on Ukraine

Special Briefing

Senior Administration Official

Via Teleconference

Washington, DC

June 20, 2014

MODERATOR: Thanks very much. So thanks to everybody for joining us, and we have with us today a senior Administration official, and we’re here to talk about Ukraine. We don’t have too much time, so I’ll get right into it and turn over the floor.

SENIOR ADMINISTRATION OFFICIAL: Thank you, colleagues, for joining. I think for purposes of attribution, let’s go with senior U.S. Administration official if that’s okay with everybody.

So just to share with all of you the story of the Ukraine-Russia diplomacy. Since the President’s trip to Europe, just to give you a reminder of where we were when the President was on the road, he, as you recall, had his first meeting with Ukraine’s new president, Poroshenko, in Warsaw even in advance of the – his – of Poroshenko’s inaugural, at which point Poroshenko sketched for the President his intention to pursue a peace plan, which included political outreach to the east, broad decentralization of power, amnesty for separatists, an exfiltration corridor for fighters to go home, and the opportunity for early elections.

Then on the evening of Wednesday the 4th in Brussels, the President met with G7 counterparts. They talked intensively about how to support Ukraine’s aspirations for a stable, peaceful, democratic future and how to encourage Russia to take a de-escalatory path. They issued a communique after the G7 dinner, which included the following calls on the Russian Federation: first, to recognize the results of the election; then to complete the withdrawal of its military forces on the border with Ukraine; third, to stop the flow of weapons and militants across the border; and to exercise its influence among separatists to lay down their weapons and renounce violence.

They also called on the Russian Federation to meet to meet the commitments made in the April 17th Geneva Joint Statement of the EU, Ukraine, Russia, and the U.S., which contained many of the same elements. And they made clear that if Russia did not follow through on all these lines, that there would be additional costs in the form of diplomatic isolation and sanctions.

On Friday, in Normandy, you’ll recall that Chancellor Merkel of Germany, President Hollande of France, President Putin, and President then-elect Poroshenko all sat down together which gave Poroshenko an opportunity to brief Putin directly on his peace plan, to ask for Putin’s support for it and for Russia’s cooperation in helping to close the border. They agreed there that Russia would send a negotiator to Kyiv. Russia – they agreed there that Poroshenko would lay out the elements of his peace plan publicly in his inaugural address the next day, and that Russia would send a negotiator back to Kyiv. And they did that. They returned their ambassador, Ambassador Zurabov to Kyiv, and that Poroshenko would host trilateral negotiations among Russia, Ukraine, and then facilitated by the OSCE to work out the details of the peace plan and the ceasefire and seek Russia’s cooperation.

Poroshenko did then sketch out the peace plan in his inaugural address the following day on Saturday the 5th, and on – no, I’m sorry, Saturday the 7th, and on Sunday the 8th, the trilateral negotiations happened. There have been eight rounds of negotiations among Russia, Ukraine, and the OSCE working on a document fleshing out Poroshenko’s peace plan, including many of the details of how it would be implemented. The Russians have participated in these, and the Russian negotiator has regularly been up to Moscow to talk to President Putin. Poroshenko and Putin have now had two, I think three phone calls in total. But the Russians have not, according to the Ukrainians, made any private statements, nor have they publicly endorsed the peace plan.

During this time, as you have seen, the Ukrainians have also been working with their own forces to try to close and interdict illegal crossings along that very long and open border on their eastern edge, Donetsk and Luhansk. They have had some success, but the fighting has been quite fierce. And as we made clear publicly last week, throughout this period, Russia has continued to supply concrete support to the separatists, including across the border.

Just a few details here. We are confident that Russia last week sent tanks and rocket launchers from a deployment site in southwest Russia to eastern Ukraine. We have information that additional tanks have been prepared for departure from the same deployment site. We also have information that Russia has accumulated artillery at a deployment site in southwest Russia, including a type of artillery utilized by Ukrainian forces, but no longer in Russia’s active forces. And we believe that Russia may soon provide this equipment to separatists.

Ground photographs from the destroyed BM-21 multiple rocket launcher that caught fire in Luhansk Oblast last week indicate that the launcher originally belonged to the Russian 18th Motorized Rifle Brigade based in Khankala, Chechnya. Russian special forces are also maintaining points along the Ukrainian border to provide support to separatist fighters. Separately we have information that Russia has redeployed significant military forces to its border with Ukraine. Some of these forces are within a handful of kilometers of Ukrainian territory, the closest that they’ve been since the invasion of Crimea. We also have information that additional forces are due to arrive in coming weeks.

And then finally you will have seen many social media reports about new shipments of tanks and heavy artillery across the border just in the last 24 hours. What I can say is that the Ukrainian Government briefed EU and G7 diplomats in Kyiv today that they have evidence of some additional 10 tanks, fuel trucks, and additional supporting vehicles coming over the border outside of Luhansk in the last 24 hours. What I am able to confirm from a U.S. Government perspective is that we have information that additional tanks departed from a deployment site in southwest Russia yesterday.

Against this backdrop, President Poroshenko nonetheless intends to implement his peace plan over the coming days. Yesterday he held a meeting in Kyiv to which he invited all eastern leaders, including the separatists, and to have a broad dialogue about political reconciliation, decentralization, return of budgeting power, local control of language, school, culture, all of those things that are in his peace plan. And we understand that he – as of this morning, he intended to declare the ceasefire within coming hours or days. What we’re not sure about is whether that time table will change as a result of the materiel movements that the Ukrainians have seen in the last 24 hours.

Meantime, we are working intensively with our European allies and partners, particularly in the context of President Poroshenko’s intention to unilaterally move forward with the peace plan and in light of lots of meetings in Europe next week, including the Monday meeting of the EU Foreign Affairs Council, the Tuesday and Wednesday meeting in Brussels of NATO foreign ministers, and the Friday meeting of EU heads of state and government on a three-point plan.

First, for all of us to actively support President Poroshenko’s peace initiative. Second, for all of us to use our influence with the Russian Federation to urge it to take this moment to step back from this destabilizing behavior, to meet the criteria that the G7 puts forward, to end its support for separatism, help close the border, and support all of these things that it has been asking for politically in eastern Ukraine that President Poroshenko is offering in the form of decentralization of power, protection of Russian language, et cetera.

And then third, however, to make clear to Russia that if its destabilization of Ukraine does not abate, and if it does not support this peace plan, that there will be more costs – more costs in the form of isolation and sanctions, and that that will be a unified effort by the U.S. and Europe.

Last point, just to say that Treasury just made public new U.S. sanctions on one, two, three, four, five, six, seven – seven separatist leaders. These are Ukrainians who have been active in the separatist movement in eastern Ukraine. That was just released a minute ago. You can find it on the Treasury website. Let me pause there for questions.

MODERATOR: Okay. Operator, if you could remind folks about the procedure for getting in the queue.

OPERATOR: Certainly, and ladies and gentlemen, once again, if you would like to ask a question on the call, please press * then 1.

MODERATOR: All right. And Operator, we’re ready for the first question, please.

OPERATOR: Great. And we’ll go to Michael Gordon with The New York Times. Please go ahead.

QUESTION: Yes, thank you. A couple of quick questions on your statement just for clarification. You noted that the Ukrainians had observed that these tanks, which you’ve observed on the Russian side of the border, you say the Ukrainians are reporting they’ve crossed – new tanks have crossed into their territory. Do you believe these Ukrainian reports are credible?

Also, what role do you think the Russian troops are playing near the border? Are they facilitating the delivery of these arms, or are they there to dissuade the Ukrainian forces from trying to seal the border?

And lastly, do you believe Russian arms shipments include anti-air weapons of some type since a number of aircraft have been shot down in recent weeks? Thank you.

SENIOR ADMINISTRATION OFFICIAL: Michael, we are watching the media. We are watching the reports of the Ukrainians ourselves. We are endeavoring to establish the facts through our own means. The only thing I’m in a position to confirm from U.S. independent information today is the statement that I made that we have information that additional tanks departed from a deployment site in southwest Russia yesterday.

With regard to this equipment, as I said in the statement, one of the concerning things about the equipment that we have confirmed has moved from Russia into Ukraine is that much of this is equipment that Ukrainians have in active service, but that Russia no longer uses, leaving the impression that the desire here is to mask the Russian hand and to allow the separatists to assert inaccurately, according to the Ukrainians, that this is materiel that they’ve captured on the battlefield from the Ukrainians when in fact it was not on that battlefield to begin with.

With regard to the Russian reasons for their plus-up up on the border, President Putin did make a public statement about supporting border control about a week ago, but we have not seen this force deploy in positions consistent with border patrol. Rather, as I said, we have seen disturbing evidence that these forces are supporting the acquisition of materiel that the Russians themselves do not use – some of this materiel we’ve seen go over the border – and that the Russian special forces are maintaining points along the Ukrainian border to provide active support for separatist fighters. Social media, the Ukrainians have asserted that there are active training camps there. I have what I gave you in terms of the points that special forces appear to be maintaining to support the separatists.

With regard to surface-to-air, the Ukrainians have recovered MANPAD tubes, particularly at the site of the IL-76 shoot-down from last week. I would refer you to some of the pictures that they’ve put out on their site with regard to the packing crates, shipping lists indicating previous addresses in Russia and in Chechnya.

MODERATOR: All right, thank you. Operator, we’re ready for the next question please.

QUESTION: Good morning. Two things. One, can you provide any additional information on the individuals whose designations were announced this morning by the Treasury? All I have seen is the most bare-bones data on their names and dates of birth. I know you said that they were involved in the separatist movement in Ukraine, but can you shed some light on whether these are actual fighters, whether they are commanders, whether they are organizers or political figures?

And then secondly, the United States has repeatedly brandished the threat of sectoral sanctions against Russia, but it seems as if the steam has entirely gone out of that since the elections in Ukraine. Is there active, serious consideration of possible imminent sectoral sanctions on Russia, particularly given the tanks crossing, or are your European allies reluctant to take that step, as they have been for some time now?

SENIOR ADMINISTRATION OFFICIAL: Thanks, Arshad. I am looking at a draft Treasury press release which goes through the names, so perhaps it just hasn’t gotten into your inbox. But just to give you the flavor, one, Ponomaryov – Vyacheslav Ponomaryov is the self-proclaimed mayor of Slavyansk, who takes a takes-no-prisoners approach. Number two, Denis Pushilin is the leader of the group that calls itself the Donetsk People’s Republic. These are the types of guys – Igor Girkin, better known as Igor Strelkov, the self-described commander-in-chief of the Donetsk People’s Republic. Valery Bolotov, the governor of the separatist-controlled Luhansk region. You get the idea.

QUESTION: Thanks. And sanctions?

SENIOR ADMINISTRATION OFFICIAL: With regard to sanctions, we have been in active conversation with our EU partners on what we call scalpel sanctions, which would be targeted primarily in the financial, defense and high-technology sectors. The idea here is to deny Russia the kind of investment and next-generation technology that it needs to continue to grow. This conversation has been ongoing for some time, but it has intensified over the last week as we have seen Russian materiel move into Ukraine in contravention of our hope and expectations that Russia would take this diplomatic moment to de-escalate. Those conversations are continuing today and over the weekend, and next week Secretary Kerry will be making some calls. We’ve been making some calls at the political director level and the White House is also making some calls, which I’m sure you will hear about in coming days.

QUESTION: Thank you.

MODERATOR: Okay, thanks. Operator, next question please.

OPERATOR: We will go to Luke Johnson with Radio Free Europe. Please go ahead.

QUESTION: Hi. I wondered if you had any assessment of the confidence you have for a ceasefire given after Poroshenko announced that heavy fighting broke out? And secondly, I saw Putin’s foreign policy advisor, Yuri Ushakov, saying that he’s planning to have a phone conversation with Obama in the coming days, and I wondered if you had any comment on that. Thanks.

SENIOR ADMINISTRATION OFFICIAL: On the latter, I’ll refer you to the White House. They speak about those kinds of things. With regard to the ceasefire, it was very clear that the Ukrainians felt that they had to gain more control of the border between the period of Poroshenko’s inauguration and today before they could move to a ceasefire, particularly given the materiel and fighters that we’ve seen cross over. They have been spending most of their time and effort doing that. Our understanding is that they will continue to do what is necessary to protect the border even as they declared the ceasefire. But the ceasefire is essentially a stand-down of their antiterrorist operation in and around the most dangerous cities – Kramatorsk, Slavyansk, Donetsk, Luhansk – to give the separatists an opportunity to meet them halfway and to demonstrate to the Ukrainian population that this government wants to – that this government is serious about reaching out.

So we will see how the separatists behave. Our view is that this has obviously a much higher chance of being successful if the separatists know that Russia has broken its support for them. And that could come in many forms. It could come in the form of a public statement of support from President Putin for the ceasefire when it happens or for the peace plan. It could come in the form of Russian negotiators traveling to eastern Ukraine and talking to separatists and telling them that there would no longer be any support and that they should accept amnesty and that they should begin cooperating. But we have yet to see any of those moves, but there is still an opportunity, as the President has been saying all along, for President Putin and Russia to de-escalate if they so choose.

So we will see. It is our understanding from our own contacts and from what we’re hearing from the Ukrainian Government, and some of us have been in recent contact with local leaders, governors, Party of Regions, that the population is completely disaffected from the separatists; that the economic conditions are deteriorating rapidly, particularly in some of these occupied towns; and that they want peace, they want an end to this, that they want to get in the business of restoring normal life, and they do want the decentralization and opportunities at local self-governance that the government is now offering, but mostly they want to get back to jobs and growth as all people do, and peace.

QUESTION: Hi. Thanks so much for holding the call. Part of my question (inaudible) answered, but I was just wondering if you could comment a little bit further on cooperation with the EU on possible future sector sanctions with Russia. Thanks so much.

SENIOR ADMINISTRATION OFFICIAL: As I said, we have had a number of rounds of discussion at the senior expert level, both with the commission and with nation states of the EU, to try to explain the sector – the scalpel sanctions package that we are working on on the U.S. side and to look at what the EU might be able to do at 28 that matches or is as close to equivalent as our different systems allow. We have had quite a bit of convergence in the last week or so and, as I said, senior-level conversations continue and will continue in coming days.

QUESTION: Thank you.

MODERATOR: All right, Operator. Next question, please.

OPERATOR: We will go to Lara Jakes with the Associated Press. Please go ahead.

QUESTION: Hi. Thanks, Senior Administration Official. I’m wondering if you can give us any explanation based on the intelligence that you’ve seen or maybe on some diplomatic conversations that have been ongoing on why we’re now seeing this resurgence from Russia, why they are now returning to the border even as these peace talks are going on. What is he thinking?

SENIOR ADMINISTRATION OFFICIAL: Look, we have long ago stopped trying to speak for Putin’s intentions or what’s inside his head. Our goal here has been to conduct a two-track approach.

First, as the President’s been saying, to give Putin, to give Russia a chance to de-escalate, a diplomatic path out of this, to try to meet – work with the Ukrainians to meet the legitimate needs of ethnic Russians and Russian speakers in Ukraine for more local self-governance, et cetera; at the same time that we make it clear to Putin and Russia that if they continue destabilizing Ukraine that there will be costs, there will be isolation, there will be more sanctions. We’ve done the round of sanctions that you have seen; our view is that they have had a profound effect on the Russian economy and on how Putin is received around the world.

So Russia has a choice to make again. I will say that some analysts in Ukraine, some analysts in our country believe that the strategy here is to create an Abkhaz-type enclave or a Transnistria-type enclave inside Ukraine on the east. Some believe that the ultimate intentions are full control – political, economic, and in security terms – of the Ukrainian state. I frankly am not going to get inside the heads of folks planning this.

MODERATOR: All right. Thank you, Operator. We have time for one final question. Go ahead.

QUESTION: Hi. Thanks for the call. First, I wanted to see if I could get a little more specificity on Lara’s question about the specific impact, if you have any statistics on the economic impact of the sanctions. Regarding isolation, the U.S. and the other members of the G8 suspended Russia and now it’s back to the G7. What other types of diplomatic isolation could be on the table if this kind of behavior continues? And then finally, regarding Poroshenko’s plan, how much domestic support does the U.S. believe there is for his efforts? Do ethnic Ukrainians support it? Do ethnic Russians trust him? What’s the U.S.’s assessment?

SENIOR ADMINISTRATION OFFICIAL: On the diplomatic isolation, the U.S. and most EU countries have now virtually ended economic – bilateral economic ties with Russia. Obviously, trade ties continue, but in terms of trying to advance a free trade agenda or any of those things, we’ve obviously all ended our military-to-military cooperation. The NATO-Russia Council continues as a political body, but all cooperation within it has ended. The EU in March advised all of its member states to – not to have bilateral visits of senior Russian officials, including President Putin, to their capitals. So this is the kind of thing that could continue, that will continue unless Russia de-escalates.

With regard to the effect of sanctions, we have shared some of these statistics in the past. I don’t have all of them in front of me, but for example, Russia spent more than $60 billion in the last two months trying to support the ruble. Its credit rating is just above junk. The IMF says that it is on the verge of recession with two quarters of negative growth. The inflation is on the rise inside Russia, as is the cost of borrowing, and every time new sanctions are applied, obviously, the market reacts.

With regard to popular support, the first best indicator is how strongly the population across Ukraine in every province of Ukraine supported President Poroshenko, who ran on this peace plan, including among those who were able to vote in Donetsk and Luhansk. I don’t know, Roz, whether there’s been any reliable polling in eastern Ukraine recently on the peace plans. Pretty hard to do at this stage. But one indicator is that polling with regard to Ukrainian attitudes towards Russia has taken a nosedive in the last two months. There was always some ambivalence in western Ukraine, but now across Ukraine attitudes towards Russia – where, I would remind you, almost every family has ties of family – are now at the bargain basement level.

The last point on the sanctions and on the choices that the Russian Government has been making – our concern also continues to be about their impact on average Russians. The Russian state hemorrhages money on their Ukraine – on their Crimea adventure, and now on trying to integrate the Crimean economy into Russia where there’s no geographic bridge even, they’re going to have to spend some five to eight billion building a physical bridge. All the money that they spent keeping troops deployed on Ukraine’s border. Inflation as I said, which is running some 20 percent, which we understand is causing most Russians to delay purchasing now and particularly purchasing of imports and luxury goods. Europeans are reporting to us export goods to Russia – that sales are flat or negative because Russians are just not buying right now.

So at some point the Russian people will start asking what this adventure is worth for them. Where are their hospitals? Where are their schools? Where are their roads, as all this money is flying out of the coffers of the Russian Federation?

QUESTION: Okay, great. Thank you.

MODERATOR: All right. Well, thank you, Senior Administration Official, and thank you to all who participated in the call. We have to cut it off now because we’ve got plenty of other things happening today. So thanks for everyone’s participation, and this closes the call now. Thanks.

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